US wheat futures ended steady to a bit higher; EU futures were more supported in spite of further strength in the euro, and ARC maintains that the market is working through a seasonal bottom. Note that hot/dry weather is scheduled for Germany, Poland and Western Ukraine in the next 10 days. The ongoing rally in the euro has pushed European origin fob offers to $192-198/MT basis spot, vs. US Gulf offers of SRW and lower protein HRW to $183-185. ARC’s contacts suggest that originating wheat from producers in Russia remains difficult amid the rising value of the ruble.
This afternoon’s NASS crop progress report leans negative. Winter wheat crop conditions were pegged at 52%, up 1% on last week, but down 10% on last year. A modest improvement in HRW conditions more than offset lower SRW ratings. Spring wheat seeding has reached 90% complete, vs. 94% last year and 84% on average. National spring wheat conditions will be published next Tuesday.
Global currencies are now working in favor of US demand and at multi-year low prices a bearish outlook is not advised. A close eye will be kept on potentially lasting heat in Europe & the Black Sea in June. We see wheat as being in a range until more is known about yield data.
